zSpace Seeks Shareholder Nod for Capital Raises, Governance Shift

Ticker: ZSPC · Form: DEF 14A · Filed: Sep 2, 2025 · CIK: 1637147

Sentiment: mixed

Topics: Proxy Statement, Shareholder Meeting, Capital Raise, Stock Dilution, Corporate Governance, Nasdaq Compliance, Director Election

Related Tickers: ZSPC

TL;DR

**ZSPC is asking shareholders to approve dilutive capital raises and a governance change, so pay attention to the vote or risk getting hosed.**

AI Summary

zSpace, Inc. (ZSPC) is holding its annual meeting on October 15, 2025, to address several critical proposals, including the election of four Class I directors and the ratification of UHY LLP as its independent auditor for fiscal year 2025. Significantly, the company seeks stockholder approval for the issuance of common stock related to a Convertible Promissory Note dated April 11, 2025, and a Common Stock Purchase Agreement dated July 7, 2025, both with institutional investors, as mandated by Nasdaq Listing Rule 5635(d). These issuances suggest recent capital-raising activities. Additionally, zSpace proposes an amendment to its Amended and Restated Certificate of Incorporation to permit stockholder action by written consent, a move that could enhance shareholder influence. The company reported 24,035,867 shares of common stock outstanding as of the August 21, 2025 record date, each entitled to one vote. The proxy statement, filed on September 2, 2025, outlines these proposals and the voting procedures for the upcoming meeting.

Why It Matters

This DEF 14A filing is crucial for ZSPC investors as it outlines significant capital-raising efforts through convertible notes and stock purchase agreements, which could lead to substantial dilution if approved, impacting per-share value. The proposed amendment allowing stockholder action by written consent could empower investors, potentially increasing their influence over corporate decisions and governance. For employees and customers, these financial maneuvers could signal either stability or distress, depending on the terms and use of funds. In a competitive market, successful capital infusion could enable zSpace to invest in R&D or market expansion, while excessive dilution might deter future investment.

Risk Assessment

Risk Level: medium — The filing indicates a medium risk level due to the need for stockholder approval for the issuance of shares in connection with a Convertible Promissory Note (April 11, 2025) and a Common Stock Purchase Agreement (July 7, 2025), both required by Nasdaq Listing Rule 5635(d). This suggests recent capital-raising activities that could lead to significant dilution for existing shareholders, impacting per-share value. While capital raises can be beneficial, the specific terms and potential for dilution introduce uncertainty.

Analyst Insight

Investors should carefully review Proposals Three and Four regarding the issuance of shares for the Convertible Promissory Note and Common Stock Purchase Agreement, as these could significantly dilute existing holdings. Vote 'For' or 'Against' based on your assessment of the company's need for capital versus the potential dilution impact. Consider the implications of Proposal Five, allowing stockholder action by written consent, as it could increase shareholder power.

Key Numbers

Key Players & Entities

FAQ

What are the key proposals zSpace, Inc. stockholders will vote on at the 2025 annual meeting?

zSpace, Inc. stockholders will vote on six key proposals at the October 15, 2025 annual meeting: the election of four Class I directors, ratification of UHY LLP as the independent auditor for fiscal year 2025, approval of common stock issuances related to a Convertible Promissory Note (April 11, 2025) and a Common Stock Purchase Agreement (July 7, 2025) to comply with Nasdaq Listing Rule 5635(d), approval of an amendment to allow stockholder action by written consent, and approval of an adjournment proposal.

Why is zSpace, Inc. seeking approval for share issuances related to the Convertible Promissory Note and Common Stock Purchase Agreement?

zSpace, Inc. is seeking stockholder approval for these share issuances to comply with Nasdaq Listing Rule 5635(d). This rule typically requires stockholder approval when a company issues shares that represent 20% or more of its outstanding common stock or voting power in a transaction, or when a director, officer, or 5% shareholder has a direct or indirect interest in the transaction.

What is the significance of zSpace, Inc. proposing an amendment for stockholder action by written consent?

The proposed amendment to zSpace, Inc.'s Amended and Restated Certificate of Incorporation to allow for stockholder action by written consent is significant because it would enable stockholders to take corporate action without holding a physical meeting. This change can increase stockholder influence and responsiveness, potentially allowing for quicker decisions on certain matters outside of the annual meeting schedule.

Who are the nominees for Class I directors at the zSpace, Inc. annual meeting?

The four nominees for Class I directors at the zSpace, Inc. annual meeting are Dr. Joanna Morris (age 59), Abhay Pande (age 57), Angela Prince (age 43), and Jane Swift (age 60). Dr. Morris has served on the Board since December 2024.

What is the record date for voting at the zSpace, Inc. annual meeting?

The record date for the zSpace, Inc. annual meeting is August 21, 2025. Only stockholders of record at the close of business on this date will be entitled to vote at the meeting or any postponement or adjournment thereof.

How many shares of common stock are outstanding and entitled to vote for zSpace, Inc.?

As of the record date, August 21, 2025, there were 24,035,867 shares of zSpace, Inc. common stock outstanding and entitled to vote. Each share of common stock is entitled to one vote.

What is a 'broker non-vote' and how does it affect voting at the zSpace, Inc. annual meeting?

A 'broker non-vote' occurs when shares are held in 'street name' and the beneficial owner does not provide voting instructions to their broker for 'non-discretionary' items. For zSpace, Inc., the Director Proposal, Nasdaq Note Proposal, Nasdaq ELOC Proposal, and COI Amendment Proposal are non-routine, meaning brokers cannot vote on them without instructions. Broker non-votes will not count for or against these proposals, but they will be counted for quorum purposes.

Where and when will the zSpace, Inc. annual meeting be held?

The zSpace, Inc. annual meeting will be held at 9:00 a.m. Pacific Time on Wednesday, October 15, 2025, at the company's headquarters located at 55 Nicholson Lane, San Jose, California 95134.

What are the deadlines for stockholders to submit proposals for zSpace, Inc.'s 2026 annual meeting?

For zSpace, Inc.'s 2026 annual meeting, stockholders wishing to submit a proposal for inclusion in proxy materials must do so by May 6, 2026. For director nominations or other business proposals not for inclusion in proxy materials, the written submission deadline is between June 17, 2026, and July 17, 2026. Additionally, for director nominees under the SEC's universal proxy rule (Rule 14a-19), notice must be provided by August 16, 2026.

How can zSpace, Inc. stockholders access proxy materials and vote?

zSpace, Inc. stockholders can access proxy materials online at www.proxydocs.com/ZSPC. They can vote by telephone, mobile device, or via the internet following instructions on the Notice of Internet Availability or proxy card. Stockholders who received a paper proxy card can complete and return it by mail. They can also attend the annual meeting in person on October 15, 2025, at 55 Nicholson Lane, San Jose, CA 95134, to vote.

Industry Context

zSpace operates in the technology sector, likely focusing on specialized hardware and software for immersive computing experiences. The company's reliance on capital raises, as indicated by the convertible note and stock purchase agreement, suggests a growth-oriented strategy or a need for funding to scale operations or develop new products in a competitive landscape.

Regulatory Implications

The company is seeking stockholder approval for stock issuances due to Nasdaq Listing Rule 5635(d), highlighting the importance of adhering to exchange regulations regarding share dilution and capital raising. The proposal to allow stockholder action by written consent could also impact corporate governance and the speed of decision-making, subject to state corporate law.

What Investors Should Do

  1. Review the proposals carefully, especially those requiring stockholder approval for stock issuance (Nasdaq Note and Purchase Agreement), to understand potential dilution and the company's financing strategy.
  2. Evaluate the election of Class I directors and the ratification of the independent auditor to assess the company's governance and financial oversight.
  3. Consider the implications of amending the charter to permit stockholder action by written consent, which could increase shareholder influence on corporate matters.

Key Dates

Glossary

DEF 14A
A proxy statement filed with the SEC by public companies to solicit shareholder votes for annual meetings or other corporate actions. (This document provides the details of the proposals being voted on at zSpace's annual meeting.)
Street Name
When shares are held by a brokerage firm, bank, or other financial institution on behalf of the beneficial owner. (Explains how many shareholders will receive voting instructions from their intermediaries rather than directly from the company.)
Appraisal Rights
The right of shareholders to demand that a corporation pay them the fair value for their shares in connection with certain corporate actions, such as a merger. (zSpace notes that stockholders do not have appraisal rights in connection with the proposals in this proxy statement.)
Nasdaq Listing Rule 5635(d)
A rule requiring shareholder approval for certain issuances of securities, typically when the issuance price is below the market price or involves a change of control. (This rule necessitates the shareholder vote for the stock issuances related to the Convertible Promissory Note and the Common Stock Purchase Agreement.)
Convertible Promissory Note
A debt instrument that can be converted into a predetermined amount of equity (common stock) under certain conditions. (zSpace is seeking approval for stock issuance related to such a note, indicating a financing arrangement.)
Common Stock Purchase Agreement
A contract between a seller and a buyer for the sale of shares of a company's stock. (zSpace is seeking approval for stock issuance related to this agreement, indicating a financing transaction.)

Year-Over-Year Comparison

This filing indicates significant recent financing activity through a convertible promissory note and a stock purchase agreement, necessitating shareholder approval under Nasdaq rules. The previous filing likely did not contain these specific capital-raising proposals. The current proxy also proposes an amendment to allow stockholder action by written consent, suggesting a potential shift in corporate governance focus compared to prior periods.

Filing Stats: 4,783 words · 19 min read · ~16 pages · Grade level 13.1 · Accepted 2025-09-02 16:05:29

Filing Documents

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT 18 Beneficial Ownership of Our Common Stock 18 i TABLE OF CONTENTS BOARD OF DIRECTORS AND CORPORATE GOVERNANCE 20 Biographical Information Regarding Directors 20 Board Leadership Structure 21 Role of Board in Risk Oversight 21 Director Independence 22 Committees of the Board 23 Board Meetings and Executive Sessions 25 Director Candidates 25 Corporate Governance 26 Transactions With Related Persons 26 Communication with Directors 28 DIRECTOR COMPENSATION 29

EXECUTIVE COMPENSATION

EXECUTIVE COMPENSATION 30 Biographical Information Concerning Executive Officers 30 Summary Compensation Table 30 Outstanding Equity Awards at Fiscal Year End 33 Executive Employment Agreements 37 ii TABLE OF CONTENTS 55 Nicholson Lane San Jose, California 95134 PROXY STATEMENT FOR THE 2025 ANNUAL MEETING OF STOCKHOLDERS To Be Held On Wednesday, October 15, 2025 GENERAL INFORMATION This proxy statement is furnished to stockholders of zSpace, Inc. (the "Company," "zSpace," "we," "us", or "our") in connection with the solicitation of proxies by and on behalf of the Board of Directors (the "Board") for use at the annual meeting of stockholders to be held at 9:00 a.m. Pacific Time on Wednesday, October 15, 2025, at our headquarters located at 55 Nicholson Lane, San Jose, California, and at any adjournments or postponements thereof (collectively, the "annual meeting"), for the purposes set forth in the accompanying Notice of Annual Meeting of Stockholders. VOTING INSTRUCTIONS AND INFORMATION Who Can Vote Only stockholders of record of zSpace, Inc. at the close of business on August 21, 2025, the record date, will be entitled to vote at the annual meeting. On the record date, there were 24,035,867 shares of common stock outstanding and entitled to vote. Each share of our common stock is entitled to one vote. Under Delaware law, stockholder will not have appraisal or similar rights in connection with any proposal set forth in this proxy statement. Voting Your Proxy If your shares are held in an account at a brokerage firm, bank, dealer, or other similar organization, then your shares are held in "street name" and you will receive instructions from such entity that you must follow in order to have your shares voted. You are also invited to attend the annual meeting. However, you may not vote your shares in person at the meeting unless you request and obtain a valid proxy from your broker or other agent. If your shares are regist

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